CHILDREN'S HOSPITAL AND HEALTH SYSTEM, INC. AND AFFILIATES CONSOLIDATED FINANCIAL REPORT MARCH 2017

Transcription

1 CHILDREN'S HOSPITAL AND HEALTH SYSTEM, INC. AND AFFILIATES CONSOLIDATED FINANCIAL REPORT MARCH 2017

2 CONSOLIDATED FINANCIAL REPORT TABLE OF CONTENTS Management Discussion and Analysis of Financial Performance 1-2 Consolidated Balance Sheet 3 Consolidated Statement of Revenue and Expenses vs YTD 4 Consolidated Statement of Changes in Net Assets vs Comparative Statistics - YTD 6 Supplemental Schedules: Consolidating Balance Sheet - March 31, Consolidating Balance Sheet - December 31, Consolidating Statement of Revenue and Expenses - Year to Date - March Consolidating Statement of Revenue and Expenses - Year to Date - March

3 Children s Hospital and Health System, Inc. Contact Information Marc Cadieux Treasurer and Chief Financial Officer (414) mcadieux@chw.org James Simaras Vice President of Finance (414) jsimaras@chw.org Sarah Kafka Director, Financial Services Controller (414) skafka@chw.org

4 Children s Hospital and Health System, Inc. Management Discussion and Analysis of Financial Performance Three Months Ended March 31, 2017 The financial statements contained here represent the activity of Children s Hospital and Health System, Inc. and Affiliates (System). Children s Hospital of Wisconsin, Inc. (Hospital) and Children s Hospital of Wisconsin Foundation, Inc. (Foundation) are the only corporations that comprise the Children s Hospital and Health System, Inc. Obligated Group (Obligated Group). Obligated Group-only information can be found in the Supplemental Schedules starting on page 7. The financial information furnished herein is unaudited and thus subject to change; however, in the opinion of management, the information reflects adjustments that are necessary to fairly state the consolidated financial operations of the System for the three month period ended March 31, The quarter ending March 31, 2017, closed with income from operations of $15,674,000 compared to $14,627,000 in Children s continues to maintain preferred brand and quality status for pediatric care in inpatient and specialty services lines, and continues to focus on growing market share in primary care visits. In addition, Children s Community Health Plan (CCHP) launched a new commercial exchange product in January Revenue Total Operating Revenue increased in 2017 over 2016 by $13,130,000 or 5.4%, with Net Patient Service Revenue (NPSR) and Capitation Revenue accounting for the largest increases. NPSR was impacted most significantly by patient volumes, which increased in 2017 over 2016 across the entire system. Most notably inpatient days increased by 11% over 2016 volumes driven by a more severe viral season than 2016 and an increase in NICU activity. In addition, outpatient visits increased at the Hospital and at the Primary and urgent care sites. Offsetting the increase in patient volume was a decrease in overall reimbursement driven by a higher government payer mix at the Hospital. The increase in Capitation Revenue resulted from a capitation rate increase for CCHP s Medicaid product along with enrollment in the new commercial exchange product. Operating Expenses Operating Expenses were $12,083,000 or 5.3% more than the prior year and reflected planned increases. Salaries increased $3,441,000 or 4.6% due to the impact of the annual merit increase and clinical staff additions to support strategic system initiatives. Employee Benefits as a percent of Salaries were 23.4% in 2017 and 24.8% in 2016, respectively. Medical Supplies increased $1,184,000 or 6.3% due to increased pharmacy, immunization, and medical/surgical supplies from increased volumes and patient/procedure mix. Medical Supplies as a percentage of NPSR was consistent at 12.0% in 2017 and Net Medical Claim Expenses increased by $3,847,000 or 8.0% due to the new commercial marketplace product and increased medical utilization. Purchased Services and Professional Fees was $1,715,000 or 7.2% higher partially from volume increases along with planned facilities projects. Nonoperating Gains (Losses) The System reported a net nonoperating gain of $25,840,000 in 2017 compared to $11,050,000 in This increase is due to a higher return on the investment portfolio during the first three months of 2017 and the termination of the interest rate swaps during

5 Other Activity The System continues to have a strong balance sheet as evidenced by its level of liquidity and low debt. Although Days Cash on Hand decreased slightly from 374 days at December 31, 2016, to 372 days at March 31, 2017, the metric was still above target and total cash and investments increased by $13,830,000. The increase in total cash and investments was due to positive operating performance and continued strong Foundation investment performance. Cash to debt and debt to capitalization metrics were 370.1% and 18.7% in 2017 compared to 364.7% and 19.3% in 2016, respectively. The Hospital s portfolio of investments continues to be invested entirely in fixed income securities while the Foundation s investment portfolio is diversified with 32% in fixed income and 68% in a variety of equity funds. Management, with oversight by the Investment Subcommittee, continually monitors the System s investment portfolio and the investment allocations. The Board of Directors adopted a policy that up to 10% of the investment portfolio may be allocated to alternative investments, as defined within that investment policy. The Investment Subcommittee continues to evaluate potential alternative investment options. As of March 31, 2017, $15.0 million has been committed, but not funded, in alternative investments. Capital expenditures of $9,556,000 were primarily related to expansion and redesign of the NICU, primary care clinic updates and Information Systems infrastructure investments. The undersigned officer hereby certifies on behalf of Children s Hospital of Wisconsin, Inc., as Obligated Group Agent, that attached hereto are the consolidated and the consolidating statements of revenues and expenses and changes in net assets of the System during the three months ended March 31, 2017, and the consolidating and the consolidated balance sheets of the System as of the end of such fiscal period. /s/ Marc A. Cadieux Marc A. Cadieux Treasurer and Chief Financial Officer Children s Hospital and Health System, Inc. 2

6 CONSOLIDATED BALANCE SHEET MARCH 2017 MARCH 2017 DECEMBER 2016 ASSETS Cash and Cash Equivalents $ 155,776,000 $ 207,855,000 Net Patient Accounts Receivable 81,773,000 79,478,000 Other Receivables 21,869,000 24,917,000 Inventory of Supplies 9,132,000 9,150,000 Prepaids and Other Current Assets 15,604,000 13,094,000 TOTAL CURRENT ASSETS 284,154, ,494,000 Investments 779,737, ,828,000 Assets Limited as to Use 215,866, ,292,000 Net Property and Equipment 461,093, ,265,000 Other Assets 16,772,000 16,248,000 TOTAL ASSETS $ 1,757,622,000 $ 1,742,127,000 LIABILITIES AND NET ASSETS Accounts Payable 26,823,000 35,831,000 Accrued Salaries and Benefits 21,332,000 42,719,000 Personal Leave Benefits 23,274,000 22,287,000 Accrued Interest Payable 1,605,000 4,951,000 Estimated Third-Party Payor Settlements 4,169,000 2,636,000 Current Installment of LTD 7,669,000 7,697,000 Medical Services Payable (IBNR) 26,731,000 28,184,000 Other Current Liabilities 16,085,000 14,945,000 TOTAL CURRENT LIABILITIES 127,688, ,250,000 Net Long Term Debt 245,086, ,019,000 Accrued Pension Costs 34,575,000 35,160,000 Other Liabilities 38,019,000 35,746,000 TOTAL LIABILITIES 445,368, ,175,000 Unrestricted 1,096,388,000 1,054,660,000 Temporarily Restricted 62,924,000 60,298,000 Permanently Restricted 152,942, ,994,000 TOTAL NET ASSETS 1,312,254,000 1,266,952,000 TOTAL LIABILITIES & NET ASSETS $ 1,757,622,000 $ 1,742,127,000 3

7 STATEMENT OF REVENUE AND EXPENSES THREE MONTHS ENDED MARCH NET PATIENT SERVICE REVENUE $ 167,150,000 $ 159,759,000 OTHER REVENUE Contributions 1,796,000 1,539,000 Assets Released from Restrictions 3,835,000 3,569,000 External Grants 10,904,000 11,221,000 Capitation Revenue 68,200,000 62,772,000 Other 4,870,000 4,765,000 TOTAL OTHER REVENUE 89,605,000 83,866,000 TOTAL OPERATING REVENUE 256,755, ,625,000 OPERATING EXPENSES Salaries 78,430,000 74,989,000 Employee Benefits 18,330,000 18,597,000 Medical Supplies 20,122,000 18,938,000 Non Medical Supplies and Other 6,595,000 6,153,000 Net Medical Expenses 52,186,000 48,339,000 Assessment Tax 2,750,000 2,894,000 Purchased Services and Professional Fees 25,525,000 23,810,000 Operation and Maintenance of Facilities 8,802,000 7,599,000 Medical College Physician and Resident Fees 10,068,000 9,627,000 Depreciation 14,948,000 14,692,000 Interest 3,325,000 3,360,000 TOTAL OPERATING EXPENSES 241,081, ,998,000 INCOME FROM OPERATIONS 15,674,000 14,627,000 NONOPERATING GAINS (LOSSES): Investment Income 3,945,000 4,151,000 Changes in Unrealized Gain/Loss on Investments 22,294,000 10,617,000 Change in Fair Value of Interest Rate Swaps - (2,998,000) Other (399,000) (720,000) NET NONOPERATING GAINS 25,840,000 11,050,000 EXCESS OF REVENUE OVER EXPENSES 4 $ 41,514,000 $ 25,677,000

8 CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS THREE MONTHS ENDED MARCH 2017 UNRESTRICTED NET ASSETS: MARCH 2017 MARCH 2016 Excess of Revenue over Expenses $ 41,514,000 $ 25,677,000 Net Assets Released from Restrictions - Capital Acquisitions 214, ,000 Increase in Unrestricted Net Assets 41,728,000 25,945,000 TEMPORARILY RESTRICTED NET ASSETS: Contributions 751,000 2,044,000 Investment Income 96,000 84,000 Net Assets Released from Restrictions - Capital Acquisitions (214,000) (268,000) Net Assets Released from Restrictions - Operations (3,835,000) (3,569,000) Change in Net Unrealized Gains and Losses on Restricted Investments 931, ,000 Endowment Fund - Annual Allocation 4,897,000 4,717,000 Increase in Temporarily Restricted Net Assets 2,626,000 3,307,000 PERMANENTLY RESTRICTED NET ASSETS: Contributions 74,000 (133,000) Investment Income 541, ,000 Change in Net Unrealized Gains and Losses on Restricted Investments 5,230,000 1,574,000 Endowment Fund - Annual Allocation (4,897,000) (4,717,000) Increase (Decrease) in Permanently Restricted Net Assets 948,000 (2,839,000) INCREASE IN TOTAL NET ASSETS 45,302,000 26,413,000 NET ASSETS - Beginning of Year 1,266,952,000 1,187,310,000 NET ASSETS - End of Period $ 1,312,254,000 $ 1,213,723,000 5

9 EXECUTIVE SUMMARY OF COMPARATIVE STATISTICS THREE MONTHS ENDED MARCH 2017 Operating Statistics Description Actual YTD Actual YTD Total FTEs 4, ,197.0 Hospital of Wisconsin Inpatient Statistics Patient Days 19,207 17,298 Average Daily Census Admissions 2,592 2,446 Average Length of Stay Medical Short Stay Days* 1,172 1,372 Observation Days 1,508 1,743 Outpatient Visits Hospital of Wisconsin 75,567 70,135 Hospital of Wisconsin Emergency Room 19,457 18,216 Medical Group 75,550 71,136 Health System - Urgent Care Visits 10,152 7,753 Total Outpatient Visits 180, ,240 Operating Room Hospital of Wisconsin 3,606 3,415 Surgicenter of Greater Milwaukee 1,030 1,151 Total Operating Room Cases 4,636 4,566 CCHP Member Months Medicaid Member Months 388, ,010 C4Kids Member Months 9,107 8,999 Together Member Months (Commercial) 8,323 - Total CCHP Member Months 406, ,009 Hospital Payer Mix Government and Government HMO 54.9% 50.8% Commercial 44.5% 48.3% Other 0.6% 0.9% Total 100.0% 100.0% * Note: 2016 Short Stay Days were restated to conform with definition adopted in

10 SUPPLEMENTAL SCHEDULES

11 CONSOLIDATING BALANCE SHEET MARCH 2017 Hospital of Surgicenter Service Hospital of Wisconsin Obligated Health of Greater Medical Physician Community Society of Consolidated Wisconsin Foundation Eliminations Group System Milwaukee Group Group Health Plan Wisconsin Eliminations Total ASSETS Cash and Cash Equivalents $ 89,758,000 $ 10,416,000 $ 100,174,000 $ 552,000 $ 2,773,000 $ 527,000 $ - $ 50,282,000 $ 1,468,000 $ - $ 155,776,000 Net Patient Accounts Receivable 79,904,000-79,904,000 1,813,000 1,062,000 4,485,000-19, ,000 (5,672,000) 81,773,000 Intercompany Receivable 69,718,000 - (28,080,000) 41,638,000-1,150, , (42,896,000) - Other Receivables 4,563, ,000 4,823, ,000-56,000-10,857,000 5,476,000-21,869,000 Inventory of Supplies 7,269,000-7,269, ,000 1,294, ,132,000 Prepaids and Other Current Assets 3,743, ,000 3,971,000 10,620,000 2, , , ,000-15,604,000 TOTAL CURRENT ASSETS 254,955,000 10,904,000 (28,080,000) 237,779,000 13,642,000 5,556,000 6,573, ,000 61,759,000 7,305,000 (48,568,000) 284,154,000 Investments 252,722, ,600, ,322,000 14,395,000 9,812, ,582,000 - (14,374,000) 779,737,000 Assets Limited as to Use - 215,887, ,887, (21,000) 215,866,000 Net Property and Equipment 409,448, , ,056,000 30,728,000 9,935,000 7,179, ,000 2,601, ,093,000 Interest in Net Assets of CHHSF 542,444,000 - (542,444,000) - 3,023, ,970,000 (4,993,000) - Other Assets 2,218, ,000 2,321,000 9,870,000 1,000 4,407, ,000 3, ,772,000 TOTAL ASSETS $ 1,461,787,000 $ 725,102,000 $ (570,524,000) $ 1,616,365,000 $ 71,658,000 $ 25,304,000 $ 18,159,000 $ 278,000 $ 81,938,000 $ 11,876,000 $ (67,956,000) $ 1,757,622,000 LIABILITIES AND NET ASSETS Accounts Payable 19,763, ,000 19,929,000 3,947, ,000 1,810, , ,000-26,823,000 Accrued Salaries and Benefits 14,036, ,000 14,551,000 4,694,000 72,000 1,355, , ,000-21,332,000 Personal Leave Benefits 14,587, ,000 14,923,000 5,527, , , ,000 1,432,000-23,274,000 Intercompany Payable - 28,080,000 (28,080,000) - 29,386,000-7,847, ,000 5,481,000 (42,896,000) - Accrued Interest Payable 1,605,000-1,605, ,605,000 Estimated Third-Party Payor Settlements 4,169,000-4,169, ,169,000 Current Installment of LTD 7,669,000-7,669, ,669,000 Medical Services Payable (IBNR) , ,847,000 - (5,672,000) 26,731,000 Other Current Liabilities 1,748,000-1,748,000 11,460, , ,000-1,562, ,000-16,085,000 TOTAL CURRENT LIABILITIES 63,577,000 29,097,000 (28,080,000) 64,594,000 55,570, ,000 12,080,000-34,833,000 8,496,000 (48,568,000) 127,688,000 Net Long Term Debt 245,086, ,086, ,086,000 Accrued Pension Costs 32,468,000-32,468, ,107,000-34,575,000 Other Liabilities 17,360, ,000 17,959,000 13,065,000-5,532, ,000 20,000 1,273,000-38,019,000 TOTAL LIABILITIES 358,491,000 29,696,000 (28,080,000) 360,107,000 68,635, ,000 17,612, ,000 34,853,000 11,876,000 (48,568,000) 445,368,000 TOTAL NET ASSETS 1,103,296, ,406,000 (542,444,000) 1,256,258,000 3,023,000 24,621, , ,000 47,085,000 - (19,388,000) 1,312,254,000 TOTAL LIAB. AND NET ASSETS $ 1,461,787,000 $ 725,102,000 $ (570,524,000) $ 1,616,365,000 $ 71,658,000 $ 25,304,000 $ 18,159,000 $ 278,000 $ 81,938,000 $ 11,876,000 $ (67,956,000) $ 1,757,622,000 7

12 CONSOLIDATING BALANCE SHEET DECEMBER 2016 Hospital of Surgicenter Service Hospital of Wisconsin Obligated Health of Greater Medical Physician Community Society of Consolidated Wisconsin Foundation Eliminations Group System Milwaukee Group Group Health Plan Wisconsin Eliminations Total ASSETS Cash and Cash Equivalents $ 140,444,000 $ 17,985,000 $ 158,429,000 $ 549,000 $ 2,590,000 $ 515,000 $ - $ 44,804,000 $ 968,000 $ - $ 207,855,000 Net Patient Accounts Receivable 77,796,000-77,796,000 1,065, ,000 3,826,000-8, ,000 (4,200,000) 79,478,000 Intercompany Receivable 60,916,000 - (28,807,000) 32,109, , , (33,152,000) - Other Receivables 5,491, ,000 5,626, , ,000-13,213,000 5,207,000-24,917,000 Inventory of Supplies 7,277,000-7,277, ,000 1,294, ,150,000 Prepaids and Other Current Assets 3,601, ,000 3,857,000 8,072,000 6, , , ,000-13,094,000 TOTAL CURRENT ASSETS 295,525,000 18,376,000 (28,807,000) 285,094,000 10,391,000 4,968,000 6,022, ,000 58,738,000 6,526,000 (37,352,000) 334,494,000 Investments 215,966, ,986, ,952,000 14,396,000 9,711, ,155,000 - (14,386,000) 713,828,000 Assets Limited as to Use - 212,302, ,302, (10,000) 212,292,000 Net Property and Equipment 412,131, , ,753,000 31,231,000 9,891,000 8,514, ,000 2,282, ,265,000 Interest in Net Assets of CHHSF 531,227,000 - (531,227,000) - 3,184, ,050,000 (5,234,000) - Other Assets 1,994, ,000 2,096,000 9,969,000 2,000 4,019, , ,248,000 TOTAL ASSETS $ 1,456,843,000 $ 698,388,000 $ (560,034,000) $ 1,595,197,000 $ 69,171,000 $ 24,572,000 $ 18,555,000 $ 269,000 $ 80,487,000 $ 10,858,000 $ (56,982,000) $ 1,742,127,000 LIABILITIES AND NET ASSETS Accounts Payable 23,468, ,000 23,997,000 7,651, ,000 2,670, , ,000-35,831,000 Accrued Salaries and Benefits 31,047, ,000 31,542,000 5,763,000 85,000 4,096, , ,000-42,719,000 Personal Leave Benefits 14,597, ,000 14,889,000 4,827, , , ,000 1,337,000-22,287,000 Intercompany Payable - 28,807,000 (28,807,000) - 20,224,000-5,687,000-2,149,000 5,092,000 (33,152,000) - Accrued Interest Payable 4,951,000-4,951, ,951,000 Estimated Third-Party Payor Settlements 2,636,000-2,636, ,636,000 Current Installment of LTD 7,697,000-7,697, ,697,000 Medical Services Payable (IBNR) ,932, ,452,000 - (4,200,000) 28,184,000 Other Current Liabilities 735, ,000 11,395, , ,000-2,013, ,000-14,945,000 TOTAL CURRENT LIABILITIES 85,131,000 30,123,000 (28,807,000) 86,447,000 52,792, ,000 13,378,000-35,079,000 8,356,000 (37,352,000) 159,250,000 Net Long Term Debt 245,019, ,019, ,019,000 Accrued Pension Costs 33,068,000-33,068, ,092,000-35,160,000 Other Liabilities 16,166, ,000 16,786,000 13,195,000-5,177, ,000 17, ,000-35,746,000 TOTAL LIABILITIES 379,384,000 30,743,000 (28,807,000) 381,320,000 65,987, ,000 18,555, ,000 35,096,000 10,858,000 (37,352,000) 475,175,000 TOTAL NET ASSETS 1,077,459, ,645,000 (531,227,000) 1,213,877,000 3,184,000 24,022, ,000 45,391,000 - (19,630,000) 1,266,952,000 TOTAL LIAB. AND NET ASSETS $ 1,456,843,000 $ 698,388,000 $ (560,034,000) $ 1,595,197,000 $ 69,171,000 $ 24,572,000 $ 18,555,000 $ 269,000 $ 80,487,000 $ 10,858,000 $ (56,982,000) $ 1,742,127,000 8

13 CONSOLIDATING STATEMENT OF REVENUE AND EXPENSES THREE MONTHS ENDED MARCH 2017 Hospital of Surgicenter Service Hospital of Wisconsin Obligated Health of Greater Medical Physician Community Society of Consolidated Wisconsin Foundation Eliminations Group System Milwaukee Group Group Health Plan Wisconsin Eliminations Total NET PATIENT SERVICE REVENUE $ 155,337,000 $ - $ - $ 155,337,000 $ 2,267,000 $ 2,212,000 $ 13,913,000 $ - $ 18,000 $ 396,000 $ (6,993,000) $ 167,150,000 OTHER REVENUE Contributions - 1,785,000-1,785, ,000-1,796,000 Assets Released from Restrictions 1,406,000 4,049,000 (1,406,000) 4,049,000 1,527, , ,000 (2,271,000) 3,835,000 External Grants 3,135, ,135, , ,495,000-10,904,000 Capitation Revenue , ,552, ,200,000 Other 4,470, ,470, , ,000 16, ,000-4,870,000 Revenue from Related Entities 315,000 - (2,000) 313,000 22,977, ,000 21, ,000 - (23,795,000) - TOTAL OTHER REVENUE 9,326,000 5,834,000 (1,408,000) 13,752,000 25,667, , ,000-67,817,000 7,813,000 (26,066,000) 89,605,000 TOTAL OPERATING REVENUE 164,663,000 5,834,000 (1,408,000) 169,089,000 27,934,000 2,549,000 14,198,000-67,835,000 8,209,000 (33,059,000) 256,755,000 OPERATING EXPENSES Salaries 44,736, ,000-45,680,000 16,818, ,000 9,092,000-1,402,000 4,940,000-78,430,000 Employee Benefits 10,764, ,000-10,950,000 3,539, ,000 1,795, ,000 1,585,000-18,330,000 Medical Supplies 17,395, ,395,000 51, ,000 2,473,000-1,000 1,000 (215,000) 20,122,000 Non Medical Supplies and Other 3,101,000 3,952,000 (1,408,000) 5,645,000 2,269,000 76, , , ,000 (2,340,000) 6,595,000 Net Medical Expenses , ,177,000 - (6,993,000) 52,186,000 Assessment Tax 2,721, ,721,000-29, ,750,000 Purchased Services and Professional Fees 32,076, ,000-32,591,000 8,519, ,000 1,078,000-4,681,000 1,441,000 (23,237,000) 25,525,000 Operation and Maintenance of Facilities 5,409,000 8,000-5,417,000 1,534, ,000 1,247, , ,000 (274,000) 8,802,000 Medical College Physician and Resident Fees 9,390, ,390, , , , ,068,000 Depreciation 13,503,000 14,000-13,517, , , ,000-26, ,000-14,948,000 Interest 3,324, ,324,000-1, ,325,000 TOTAL OPERATING EXPENSES 142,419,000 5,619,000 (1,408,000) 146,630,000 33,794,000 2,051,000 16,436,000-66,063,000 9,166,000 (33,059,000) 241,081,000 NET OPERATING INCOME 22,244, ,000-22,459,000 (5,860,000) 498,000 (2,238,000) - 1,772,000 (957,000) - 15,674,000 NON OPERATING INCOME (EXPENSE) Investment Income 1,578,000 2,244,000-3,822,000-56, , ,945,000 Change in Unrealized Gain/Loss on Investments 527,000 21,717,000-22,244,000-45, , ,294,000 Change in Fair Value of Interest Rate Swaps Other Nonoperating Income (Expense) (249,000) - - (249,000) (150,000) - - (399,000) NON OPERATING INCOME (EXPENSE) 1,856,000 23,961,000-25,817, , (78,000) ,840,000 EXCESS (DEFICIT) OF REVENUE OVER EXPENSES $ 24,100,000 $ 24,176,000 $ - $ 48,276,000 $ (5,860,000) $ 599,000 $ (2,238,000) $ - $ 1,694,000 $ (957,000) $ - $ 41,514,000 9

14 CONSOLIDATING STATEMENT OF REVENUE AND EXPENSES THREE MONTHS ENDED MARCH 2016 Hospital of Surgicenter Service Hospital of Wisconsin Obligated Health of Greater Medical Physician Community Society of Consolidated Wisconsin Foundation Eliminations Group System Milwaukee Group Group Health Plan Wisconsin Eliminations Total NET PATIENT SERVICE REVENUE $ 149,369,000 $ - $ - $ 149,369,000 $ 1,030,000 $ 2,341,000 $ 12,547,000 $ 2,000 $ 23,000 $ 374,000 $ (5,927,000) $ 159,759,000 OTHER REVENUE Contributions - 1,534,000-1,534, ,000-1,539,000 Assets Released from Restrictions 1,634,000 4,409,000 (1,634,000) 4,409,000 1,249,000-80, ,000 (2,411,000) 3,569,000 External Grants 2,975, ,975, , ,023,000-11,221,000 Capitation Revenue ,954, ,818, ,772,000 Other 4,369, ,369, , ,000 5, ,000-4,765,000 Revenue from Related Entities 427,000 - (1,000) 426,000 22,893, ,000 8, ,000 (23,548,000) - TOTAL OTHER REVENUE 9,405,000 5,943,000 (1,635,000) 13,713,000 28,564, ,000 93,000-58,818,000 8,303,000 (25,959,000) 83,866,000 TOTAL OPERATING REVENUE 158,774,000 5,943,000 (1,635,000) 163,082,000 29,594,000 2,675,000 12,640,000 2,000 58,841,000 8,677,000 (31,886,000) 243,625,000 OPERATING EXPENSES Salaries 44,225, ,000-45,013,000 15,071, ,000 8,171,000-1,110,000 5,056,000-74,989,000 Employee Benefits 11,289, ,000-11,452,000 3,336, ,000 1,667, ,000 1,703,000-18,597,000 Medical Supplies 16,420, ,420,000 53, ,000 2,172,000-1,000 1,000 (231,000) 18,938,000 Non Medical Supplies and Other 2,804,000 4,123,000 (1,635,000) 5,292,000 1,911,000 62, , ,000 1,017,000 (2,485,000) 6,153,000 Net Medical Expenses ,831, ,435,000 - (5,927,000) 48,339,000 Assessment Tax 2,816, ,816,000-78, ,894,000 Purchased Services and Professional Fees 30,909, ,000-31,365,000 8,965, ,000 1,058,000-3,508,000 1,331,000 (22,890,000) 23,810,000 Operation and Maintenance of Facilities 4,633,000 7,000-4,640,000 1,447, ,000 1,011,000 (1,000) 111, ,000 (353,000) 7,599,000 Medical College Physician and Resident Fees 8,902, ,902, , , , ,627,000 Depreciation and Amortization 13,272,000 18,000-13,290, , , ,000-30, ,000-14,692,000 Interest 3,360, ,360, ,360,000 TOTAL OPERATING EXPENSES 138,630,000 5,555,000 (1,635,000) 142,550,000 34,822,000 2,325,000 14,713,000 (1,000) 56,750,000 9,725,000 (31,886,000) 228,998,000 NET OPERATING INCOME 20,144, ,000-20,532,000 (5,228,000) 350,000 (2,073,000) 3,000 2,091,000 (1,048,000) - 14,627,000 NON OPERATING INCOME (EXPENSE) Investment Income 2,413,000 1,637,000-4,050,000-54, , ,151,000 Change in Unrealized Gain/Loss on Investments 4,398,000 5,911,000-10,309, , , ,617,000 Change in Fair Value of Interest Rate Swaps (2,998,000) - - (2,998,000) (2,998,000) Other Nonoperating Income (Expense) (530,000) - - (530,000) - - (15,000) - (175,000) - - (720,000) NON OPERATING INCOME (EXPENSE) 3,283,000 7,548,000-10,831, ,000 (15,000) - (51,000) ,050,000 EXCESS (DEFICIT) OF REVENUE OVER EXPENSES $ 23,427,000 $ 7,936,000 $ - $ 31,363,000 $ (5,228,000) $ 635,000 $ (2,088,000) $ 3,000 $ 2,040,000 $ (1,048,000) $ - $ 25,677,000 10